The increase in operating profit was driven by LG's mobile business which was profitable in 2012 after suffering two years of losses. LG's smartphone shipments jumped 56 percent over a year earlier to 8.6 million in the fourth quarter, helped by its Optimus series of phones based on the Android operating system.

LG Electronics is among the smaller players in the smartphone market. Counterpoint Technology Market Research estimated that more than 90 percent of the smartphone market's profit is claimed by Samsung Electronics Co. and Apple Inc.

But higher-end smartphones have steadily increased in importance for LG's overall mobile business as it battles competition from Chinese makers at the low-cost end of the market.

LG said it plans to bet on countries that have begun introducing faster wireless networks called LTE, which it expects will produce higher demand for smartphones compatible with the new technology.

The company, which competes in the TV market with Sony Corp., Panasonic Corp. and local rival Samsung Electronics Co., is counting on early launches of advanced displays such as OLED and ultra-high definition this year to get ahead of its rivals.